Sinha, J. - (1.) The facts in this case are shortly as follows: Ladhuram Taparia and Ganpatrai Taparla are two brothers. Hanumanbux and Ganeshmall are the sons of Labhuram. Sovachand is a son of Ganpatrai. There are four firms, namely, (1) Ladhuram Taparia, (2) Jagannath Hanumanbux, (3) Jagannath Harnarain and (4) Ganpatrai Jorawar-mal. It is claimed that these are partnership firms. The only outside partner is Bhairadan Maheswari in No. 1 firm and Mahalchand Bald and Kanayalal Lohia in firm No. 4. So far as firm No. 2 is concerned, with which we are directly interested in this application, it is claimed that the partners are Hanumanbux and Ganpatrai. These firms were being assessed for income-tax separately and the firm of Jagannath Hanumanbux was also registered under the income-tax Act separately, until the assess ment year 1945-46. In that year the Income tax authorities found that all these firms really were owned by Ladhuram and his brother Ganpatrai, carrying on business as Ladhuram and his brother Ganpatrai, carrying on business as Ladhuram Tapa-ria, and in which Ladhuram was the dominant partner. It was held that the other persons who claimed as partners were mere employees, and at least one of them could not be traced and might not have existed at all. The original assessment order concerned six firms, all of which were held to be benami businesses carried on by the firm of Ladhuram Taparia. Upon appeal, the Income-tax Appellate Tribunal, Calcutta, held that the above-mentioned four firms wore all benami businesses of Ladhuram Taparia, but that the remaining two were partnership firms in which outsiders were interested. There have been further appeals from the Appellate Tribunal and the matter is now pending before the Supreme Court. Meanwhile, the firm of Jagannath Hanumanbux submitted a return lor the year 1945-46. As has been mentioned above, the Income-tax authorities had already held that the firm did not consist of the two alleged partners, Hanumanbux and Ganpatrai, but was a business carried on in benami by the firm of Ladhuram Taparia. The authorities were, therefore, put in a very difficult situation. If they refused to assess the firm of Jagannath Hanumanbux and if the appeal now pending before the Supreme Court is successful, in that event, the assessment of the firm of Jagannath Hanumanbux might be barred by limitation. Therefore, what they have done is to make what is called a "Protective assessment". A copy of the assessment order dated 30-3-1950 is annexed to the petition and marked with the letter "A". The order recites that a return had been submitted by the firm of Jagannath Hanumanbux on the footing that Hanumanbux and Ganpatrai were the partners, which fact was not acceptable to the income-tax authorities. The income-tax officers proceeded to say as follows: "For the reasons elaborately discussed in file No. CC-II/492, I have come to the conclusion that the constitution of the firm shown in the return submitted by the assessee is not acceptable and the business styled Jagannath Hanumanbux does not belong to a firm consisting of (1) Hanumanbux Taparia and (2) Ganpatrai Taparia, as partners only as alleged. The assessee, however, in the return submitted has shown the profits from the firm of Jagannath Hanumanbux. With a view to safeguard the interest of revenue against any adverse finding arising, if any, on appeal, I am accepting the assessee's contention here and form the assessment as below ........ " The firm has been assessed upon a total income of Rs. 1,94,3677-. Thereafter, there was a notice of demand under Section 29, Income-tax Act for payment of the sum of Rs. 1,15,334/10/-. The amount not having been paid, the Income-tax Officer forwarded a certificate to the Certificate Officer, 24 Pergannas, Alipore, under Section 46(2), Indian Income-tax Act. In the certificate proceedings, notice under Section 7, Public Demands Recovery Act was served on the petitioners and they preferred an objection under Section 9. The objection was that under the orders of the Appellate Tribunal, the income of the firm has to be treated as income of Ladhuram Taparia. The income-tax authorities asked that these certificates against Jagannath Hanumanbux be kept pending.
(2.) In the affidavit-in-opposition affirmed by A. Bubshi dated 15-1-1955, para 9, it is stated as follows: "With reference to para 9 of the said petition, I admit that a certificate under Section 46(2) Indian Income-tax Act was forwarded to the Collector for recovery of the arrears due from the petitioner in respect of the assessment year 1945-46, but I say that the certificate Officer was requested not to execute the certificate in view of the fact that the demand nevertheless was in respect of a protective assessment."
(3.) The Certificate Officer did not accede to this request but cancelled the certificate against Jagannath Hanumanbux, holding that these certificates should merge with the certificates issued against Ladhuram Taparia. It is stated that the income-tax authorities have appealed against this order.;